Friday, March 14, 2014

On March 9th or 10th, 2000 (gimme a break it was 14 years ago) Abby Joseph Cohen and Mark Mobius both came out to warn that the NASDAQ had gotten ahead of itself. The index was around 5000 at that point having risen from 3000 just 4 months earlier. The saying goes that they don't ring a bell at the top but you couldn't have gotten a clearer signal that the stock market was way too high at that point. I think we just had another bell ring.

China
is braced for a wave of industrial bankruptcies as its slowing economy
forces companies with sky-high debts to the wall, the country's premier
has said.

Premier Li Keqiang
told lenders to China's private sector factories they should expect
debt defaults as the world's second largest economy encounters "serious
challenges" in the year ahead.

Speaking after the annual session
of the national people's congress, Li Keqiang said: "We are going to
confront serious challenges this year and some challenges may be even
more complex." He told lenders to China's private sector factories they
should expect debt defaults. [Emphasis added.]